House building grew at its fastest pace for a decade in November amid surging demand from a property market buoyed by Government initiatives.

Figures from the closely watched Markit/CIPS purchasing managers' index (PMI) for construction showed UK housing activity at its highest since November 2003.

It helped overall PMI for the sector accelerate to 62.6, the best level since August 2007 and up sharply from 59.4 in October – where a reading of 50 separates growth from contraction. Job creation was also at a six-year high.

Markit chief economist Chris Williamson said the housing figures suggested the number of new home starts had risen to 40,000-45,000 per quarter in recent months, up from 28,000 at the end of last year.

This suggested the wider improvement in the UK economy was more likely to be sustainable with the boost in housing supply helping to meet buoyant demand, Mr Williamson said.

Combined with improvements in manufacturing data, the figures also added to the likelihood that gross domestic product growth could accelerate to more than 1% for the fourth quarter.

The construction upturn came as demand for property is spurred by the Government's Help to Buy scheme to help would-be homeowners struggling to find a deposit, as well as low interest rates.

Meanwhile, the Funding for Lending scheme to improve borrowing has proved so successful in helping the mortgage market it has had to be cancelled and refocused on small businesses.

But the PMI figures also showed commercial construction growth accelerating while civil engineering continued to expand, though at slightly below the pace it managed the previous month.

Mr Williamson said: "The survey indicates that the construction upturn is not simply predicated on a housing market boom fuelled by Government initiatives and low borrowing rates."

Anecdotal evidence found that improvements across the sector were driven by rising confidence in the economic outlook and improving credit conditions. Firms also reported greater optimism for the year ahead.

However, the sector has a long way back to return to its best levels, with latest official figures showing it was 13.3% off its pre-recession peak.